Tips From a Financial Planner for Immigrant Parent Estate Planning

Our experts answer readers’ investing questions and write unbiased product reviews (here’s how we assess investing products). Paid non-client promotion: In some cases, we receive a commission from our partners. Our opinions are always our own.About a year ago, I wanted to talk to my mom about her estate planning and financial needs. My efforts were met with hesitation — and understandably so. Talking about money can be emotional, and it’s easy to feel guarded when you feel like someone is trying to pry. In turn, her financial situation and needs remain ambiguous.I reached out to Valerie Rivera, a certified financial planner and founder of FirstGen Wealth, a virtual, fee-only financial life planning practice for first-generation professionals. I wanted to know the best way to work with my parents on their estate planning and helping them in retirement.”If you’re first generation, you’re often navigating new territory and often feel stuck between two worlds,” says Rivera. “Plus, there’s no network, no inside connection to the professional world, and no financial safety net.”Here are six steps that first-generation folks can take to breach the topic of estate planning and finances with their immigrant parents.As Rivera explains, parents of first-generation folks often faced different challenges and struggles than their children. They often sacrificed everything, leaving their homeland and families to enter a new culture, learn a new language and way of life, and often faced extreme discrimination.Parents might have a hard time understanding the challenges of their first-generation children. They might view them as being more trivial than what they endured.Along with that comes very high standards to make money and to be monetarily successful. “This can create a lot of expectations for children who know they’re carrying a future of financial obligation,” says Rivera. “It can lead to people put into roles they’re not passionate about.”Rivera says that if you’re first generation, there’s a strong likelihood you’ve experienced some financial trauma. Financial trauma involves a range of physical, mental, and emotional responses of actual or potential financial harm.”Millennials in particular may exhibit PTSD-like symptoms due to financial stress,” says Rivera. “These symptoms may manifest as money avoidance, procrastination, denial of healthy financial choices, and challenges in managing your financial life.”Rivera says many people feel pressure to make sure their parents’ struggles and the risk they took in uprooting to a new country weren’t for naught. “There can be a range of emotions — guilt, pressure, stress, resentment, hope, fear — placed on the kids to be successful,” says Rivera.Learn what information you do and do not choose to share. When you reach financial success, not everyone will always be happy for you. You might have family members who want to see you do well but are envious. Be conscious of who might think of you as a sellout because you enjoy a higher standard of living.Before you even broach the topic of estate planning with your parents, get your own estate-planning ducks in a row. “That way, you’re building your empathy and handling your own personal finances,” she says. “You’ll also be better equipped to aid your parents through the process.”This might involve working with an estate attorney, who can help you figure out the best type of estate plan for your situation and needs.Once your own estate planning is complete, bring it up with anyone who need to be involved. Besides your parents, this might include siblings, or close and trusted friends and relatives. “This is a great opportunity to discuss with a parent what you’ve just gone through,” Rivera says. “Let them know that past your time on Earth, there is a documented, legal plan to help ease the burden for the surviving family.”Remember that estate planning is a delicate topic. Since it’s hard to know how people will respond, it’s best to handle it delicately.You’ll also want to do it during a time when your parents are feeling rested, not stressed, and in an environment that feels safe for them.Rivera says there are many reasons parents may not wish to discuss estate planning. “They may think they don’t have much in their name and therefore a legal document is not worth the effort. The topic can be taboo and simply viewed as rude to discuss.”In talking to your parents, Rivera suggests framing estate planning as the ultimate form of control and selflessness. That might make it easier for immigrant parents to warm up to the idea. “The estate plan is not for the deceased,” says Rivera, “it’s for the people remaining. In their time of grief, having documents laying out their wishes, and having the paperwork organized can help ease the burden for the family.”If you think you might need to financially support your family members, set up a sinking fund for your family, and commit to auto-saving a set amount regularly.In figuring out how much you can reasonably afford to put into this fund, Rivera says you should think about your spending plan, and automate any savings and investing. For instance, after reviewing your expenses and savings and investing goals, you might decide you can put $200 into a high-yield savings account each month.A sinking fund helps you establish financial boundaries and limits on how much you can afford to support your family. “If a family member asks for more, you can confidently say you don’t have the funds, because the sinking fund is empty until next month,” says Rivera. “Having this in place can help stop you from giving money allocated to other areas of saving and investing.””Many first-gen clients I work with come from communal backgrounds, raised with a community mindset,” says Rivera. “That’s the opposite of the individualistic, zero-sum thinking of modern America. These opposing sentiments can be conflicting.”The important thing is to stay in alignment with what’s most important to you. “Society tells us what our priorities should be — that we should spend all our time working, making as much money as possible for our personal gain,” says Rivera. “Choosing to share with family and help others can be viewed as a sign of weakness, or being taken advantage of. Stay true to your values and priorities in life, including how you spend your money and where your time and energy go. They’re all intertwined. ”

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